FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT
FIRST
AMENDMENT TO PURCHASE AND SALE AGREEMENT
THIS
FIRST AMENDMENT
dated as
of August 24, 2006 (this “Amendment”) to Purchase and Sale Agreement dated as of
February 15, 2006 (the “Purchase Agreement”) made between Southern Union
Company, a Delaware corporation (“Seller”), and National Grid USA, a Delaware
corporation (“Buyer”).
RECITALS
WHEREAS,
the parties desire to make certain amendments to the Purchase Agreement to
the
extent and in the manner hereinafter set forth;
NOW,
THEREFORE, in consideration of the premises and agreements contained herein,
and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, and intending to be legally bound hereby, the parties
hereto hereby agree as follows:
1.
Defined
Terms.
All
capitalized terms used, but not defined, in this Amendment shall have the
meanings ascribed or given to them under the terms of the Purchase
Agreement.
2.
Amendment
to Schedule 1.1(b).
The
Purchase Agreement is hereby amended by adding to Schedule
1.1(b)
the
following: “IV. All access agreements relating to Retained Environmental
Liabilities and V. The Privileged Communications.”
3.
Amendment
to Section 2.3.
The
Purchase Agreement is hereby amended by adding the following provision at the
end of Section 2.3:
Nothing
contained in this Agreement shall constitute or be construed as a waiver of
Seller's attorney-client, work product and other privileges, including with
respect to any Excluded Asset and any Retained Liability. Seller hereby retains
all privileged communications with respect to any Excluded Asset and any
Retained Liability (the "Privileged Communications"). Any transfer of Privileged
Communications to Buyer hereunder is inadvertent, and Buyer shall immediately
return any Privileged Communications to Seller upon its discovery that it
is in possession of the same or upon demand by Seller.
4.
Amendment
to Section 12.1.
The
Purchase Agreement is hereby amended by amending Section 12.1 in its entirety
to
read as follows:
Section
12.1 Indemnification by Seller.
From and
after Closing and subject to the other provisions of this Article XII, Seller
shall indemnify and hold harmless Buyer, its Representatives, Affiliates (which
after the Closing shall include the Subsidiaries), successors and permitted
assigns (collectively, the “Buyer Indemnitees”) from and against any and all
Losses actually incurred by a Buyer Indemnitee, and resulting
from:
(a)
(i)
any representations and warranties made by Seller in this Agreement or in any
certificate furnished by or on behalf of Seller to Buyer pursuant to this
Agreement not being true and correct when made, or (ii) any representations
and
warranties made by Seller in this Agreement not being true and correct as of
the
Closing Date, each of which representations and warranties will be deemed for
purposes of this Section 12.1(a)(ii) to have been made by Seller as of the
Closing Date, except that those representations and warranties that are made
as
of a specific date will be deemed for purposes of this Section 12.1(a)(ii)
to
have been made by Seller as of such date;
(b)
any
breach or default by Seller in the performance of its covenants, agreements,
or
obligations under this Agreement, the Employee Agreement or the Transition
Services Agreement;
(c)
the
Retained Liabilities;
(d)
the
Excluded Assets; and
(e)
satisfaction by The Narragansett Electric Company (“Narragansett”) of its
payment obligations under that certain letter agreement dated August 24, 2006
made by Narragansett in favor of the State of Rhode Island, as in effect on
the
date hereof (the "Tiverton Letter Agreement"), a copy of which has previously
been provided to Seller. Seller hereby acknowledges that nothing contained
in
the Tiverton Letter Agreement shall, for purposes of this Agreement, be deemed
to limit or modify the definition of Retained Environmental Liabilities, and
that the rights of the Buyer Indemnitees under this Section 12.1(e) shall be
in
addition to any other rights the Buyer Indemnitees have under this Agreement
in
respect of any Retained Environmental Liabilities.
5.
Amendment
to Section 12.3.
Section
12.3 of the Purchase Agreement is hereby amended by adding the following
subsection (h):
(h)
Notwithstanding anything in this Agreement to the contrary, (i) the limitations
set forth in Section 12.3(f) shall not apply to any indemnification obligation
of Seller under Section 12.1(e) and (ii) for the avoidance of doubt, no
indemnification payment under Section 12.1(e) shall be deemed to be subject
to,
or to otherwise affect, the limitations set forth in Sections 12.3(c), (d)
or
(e).
6.
Amendment
to Section 12.5.
Section
12.5 of the Purchase Agreement is hereby amended by adding the following
subsection (d):
(d)
Notwithstanding the foregoing, the provisions of subsections (a), (b) and (c)
of
this Section 12.5 shall not apply to any claim for indemnification under Section
12.1(e). In the event that (i) a Judgment (as defined in the Tiverton Letter
Agreement) becomes final and nonappealable and (ii) the State of Rhode Island
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provides
written notice to Narragansett and Seller that the State of Rhode Island intends
to demand payment from Narragansett under the Tiverton Letter Agreement (a
"Tiverton Payment Notice"), Buyer shall deliver to Seller evidence, satisfactory
to Seller, of Narragansett’s payment under such Tiverton Payment Notice in
accordance with the terms of the Tiverton Letter Agreement, which evidence
shall
specify the amount of such payment (a “Narragansett Payment Notice”). Seller
shall pay to Buyer or its designee, within three Business Days after Seller’s
receipt of the Narragansett Payment Notice, by wire transfer of immediately
available funds to an account specified by Buyer, an amount of cash equal to
the
amount specified in the Narragansett Payment Notice (but in no event more than
the lesser of (x) $13 million and (y) the then-remaining amount of liability
of
Narragansett under the Tiverton Letter Agreement).
7.
Representations
and Warranties.
Each of
the parties to this Amendment hereby represents and warrants to the other that
(i) it has full organizational power and authority to execute and deliver this
Amendment and to consummate the transactions contemplated hereby, (ii) the
execution and delivery of this Amendment by such party have been duly and
validly authorized by all necessary corporate action on the part of such party
and (iii) this Amendment has been duly and validly executed and delivered by
such party and constitutes a valid and binding obligation of such party,
enforceable against such party in accordance with its terms, except that such
enforceability (x) may be limited by bankruptcy, insolvency, moratorium or
other
similar laws affecting or relating to the enforcement of creditors' rights
generally and (y) is subject to general principles of equity and the discretion
of the court before which any proceedings seeking injunctive relief or specific
performance may be brought.
8.
No
Other Modification.
This
Amendment amends the Purchase Agreement only to the extent and in the manner
herein set forth. All references in the Purchase Agreement to the Purchase
Agreement shall mean the Purchase Agreement as amended by this Amendment. In
all
other respects, the terms and conditions of the Purchase Agreement shall remain
in full force and effect.
9.
Governing
Law.
The
validity, performance and enforcement of this Amendment shall be governed by
the
laws of the State of New York without giving effect to the principles of
conflicts of law of such state.
10.
Counterparts.
This
Amendment may be executed in multiple counterparts, each of which shall be
deemed to be an original and all of which together shall constitute one and
the
same instrument.
11.
Headings.
The
headings contained in this Amendment are for reference purposes only and shall
not affect in any way the meaning or interpretation of this
Amendment.
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IN
WITNESS WHEREOF,
the
parties have caused this Amendment to be executed and delivered by their duly
authorized officers as of the date first above written.
SOUTHERN
UNION COMPANY
By:
/s/ XXXXXX
X. XXXXXXX
Name: Xxxxxx
X. Xxxxxxx
Title:
Vice
President
NATIONAL
GRID USA
By:
/s/
XXXXXXX X. XXXXXXX
Name:
Xxxxxxx
X. Xxxxxxx
Title:
President
and Chief Executive Officer
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